MORAN: Good morning, and welcome to "This Week." The battles lines
are drawn.

(BEGIN VIDEO CLIP)

OBAMA: It's a whole lot easier to say no to everything. It's a
whole lot easier to blame somebody else.

FORMER GOV. MITT ROMNEY (R-MASS.): We conservatives don't have a
corner on saying no. We're just the ones who say it when it's the right
thing to say.

(END VIDEO CLIP)

MORAN: While another Democrat leaves the Senate and calls the
system broken.

(BEGIN VIDEO CLIP)

SEN. EVAN BAYH, D-IND.: I do not love Congress.

(END VIDEO CLIP)

MORAN: Is Senator Bayh right? Can Washington solve our most
pressing national problems, the economy, the debt, health care?
Questions for our exclusive headliners, two prominent governors who call
it like it is, Republican Arnold Schwarzenegger of California and
Democrat Ed Rendell of Pennsylvania, together with their own bipartisan
agenda for rebuilding America's infrastructure. Schwarzenegger and
Rendell, only on "This Week."

Then.

(BEGIN VIDEO CLIP)

TIGER WOODS: I was wrong. I'm embarrassed. I am so sorry.

(END VIDEO CLIP)

MORAN: The Tiger Woods confession. That and the week's politics on
our roundtable with George Will, Donna Brazile, political strategist
Matthew Dowd and Arianna Huffington of the "Huffington Post." And as
always, the Sunday funnies.

(BEGIN VIDEO CLIP)

DAVID LETTERMAN, TALK SHOW HOST: Tiger Woods is making a televised
public apology. Televised public apology tomorrow. He needs three more
to tie my record.

(END VIDEO CLIP)

MORAN: And good morning, everyone. There will be some high
political theater and hard political work in the week ahead in
Washington. On Thursday, the main event. President Obama hosts his
televised health care summit with Republican and Democratic leaders,
hoping to find common ground there. Good luck on that. And Congress
returns from recess this week with a full plate, especially as the
Senate takes up a jobs bill.

And joining me now to discuss all this, two men who are known to
reach across the aisle and are also on the frontlines of dealing with
the struggling economy -- California Governor Arnold Schwarzenegger,
Pennsylvania Governor Ed Rendell. They are also leading a bipartisan
organization, Building America's Future, dedicated to rebuilding the
infrastructure in the country. We'll get to that. Gentlemen, welcome.

SCHWARZENEGGER: Thank you, nice to be here.

RENDELL: Nice to be here.

MORAN: Let's start with the economy. The nation's governors,
including of course the two of you, are here in Washington, and the
chairman of the Governors Association, Jim Douglas of Vermont, said very
starkly, looking at the economy, at the impact on states, budgets,
employment the rest, he said the worst probably is yet to come. Do you
agree with that, Governor Schwarzenegger?

SCHWARZENEGGER: I believe that the worst is over.

MORAN: The worst is over.

SCHWARZENEGGER: I think that the economy, we see signs of a
comeback, but it's very clear that the comeback is not going to be as
quick as we've seen in the past. It's slow, and we have (ph) seen in
our revenues that there's more than a billion dollars a month coming in
more than we anticipated. We've seen that the foreclosure rate has
slowed down. We've seen that the house sales have picked up. We've
seen people are getting back to work, especially in the green sector.
So there's signs all over, but the key thing is not to be overly
optimistic, just to be optimistic, and to keep pushing and to take the
responsibility that we have as a -- at the state level is to do even
thought we have a limited amount of power, but to do everything that we
can to do -- to create jobs, jobs, jobs. To get the economy back and to
create those jobs, because that is the important thing.

We in California have a 12 percent unemployment rate, and the faster
we get the people back to work, the better it is.

MORAN: What's the view from Harrisburg? The worst is yet to come,
or the worst is over?

RENDELL: No, I agree with Governor Schwarzenegger. Our economy has
done much better. We're at about a 8.8 percent unemployment, I think
the lowest of any big state. We have a very diversified economy that
sort of has gotten us through this, although 8.8 percent is terrible,
obviously. But we've seen real signs of improvement. In the last three
months together, we only lost 4,300 jobs, and we were losing 30,000,
40,000 a month a year ago. So things are getting better. Arnold is right.

Our economists predict growth will actually return next year, 3
percent growth, not great. The following year, they predict 4.5 percent
growth, which is almost where we were in the beginning of the last
decade, in the middle of the last decade.

But I think what Jim Douglas was referring to is the states are
going to really have a problem when the stimulus money drops off. It's
going to be a problem. But again, stimulus was never meant to be a
permanent solution. It was meant to do two things. One, to be a bridge
until growth returns, and it has been a very helpful bridge. No ifs,
ands and buts about it. We would have had to lay off 50,000 more people
had we not had the federal stimulus funds.

And then secondly, President Obama did something (inaudible). A lot
of the programs are long-term programs. The green energy jobs, the
broadband, the electrical grid jobs. Those jobs, that benefit from the
stimulus is going to stretch out over the next five to 10 years. So
states are going to have a management problem of their own budget when
the stimulus funds drop off, but the economy -- I agree with the
governor's estimate -- is coming back slowly, I think surely.

MORAN: Well, the Senate, as I said, is taking up a jobs bill this
week, $15 billion. When it started at the White House, it was $200
billion. The House passed a $180 billion version. There was a deal for
$85 billion. We're down to $15 billion now, but do you think there
needs to be another stimulus, federal stimulus like this? Is $15
billion enough?

SCHWARZENEGGER: Well, I don't think that we need another stimulus
as much as what we need is just to do what we have been talking about
over the last two years, and that is rebuild America, because that will
create jobs. That is why it is so important to think about the
infrastructure, because we happen to be at a stage right now where if we
don't rebuild our infrastructure, we're going to fall behind
economically and we're not going to be the number one nation anymore. I
mean, right now, we are the most powerful nation, but it is because we
have this great infrastructure that over the last 100 years, we have
built, built and built. But in the last few decades, we have stopped
maintaining that infrastructure and we have stopped building and
expanding that infrastructure, even though there's tremendous demand for
that infrastructure.

So if you build this infrastructure and do what was recommended,
$2.2 trillion of infrastructure, that will put a huge amount of people
to work and it really will stimulate the economy, and they did that in
the 40s and in the 50s, and Eisenhower did it in the 50s. And even into
the 60s, the height of infrastructure was in the early 60s, it was the
height. Maybe even when I came here to this country, there was this
enormous boom of expansion of freeways and bridges and waterways and the
universities and all this. And now we're kind of like only spending 2.5
percent of our GDP on infrastructure, rather than the 5 percent that we
should be spending.

MORAN: $2.2 trillion -- we had money back in the 1950s and 60s.
That is a gigantic amount of money, and when people think about
infrastructure, they get it -- roads, bridges -- they understand it.
But wasn't there $200 billion or so worth of infrastructure spending in
the stimulus a year ago?

RENDELL: Actually, a little less than we recommended to the
president when we met with him when he was president-elect. I would
have liked to have seen the infrastructure money in the original
stimulus at least doubled. And so did Senator Boxer and some other
people in the Senate. But still, it was a nice hunk of money, but it
just scratches the surface, and the governor is right. What's great
about infrastructure spending is one, we need it, for safety, we need it
for quality of life and we need it for economic competitiveness.

But two, it's the best jobs creator. Economists (inaudible) $1
billion of infrastructure spending will create 40,000 jobs that can't be
outsourced, that are here in America, that are good, family-sustaining
jobs. And they're not just jobs on the construction site. We've seen
this in our stimulus figures. They're jobs back in the steel factories
and the asphalt factories and the concrete factories and the electrical
factories and the wooden timber factories. So if you want to preserve
American manufacturing and get it to thrive again, and put this country
back to work, long-term -- and the key is here, your lead-in saying
Washington is broken, and sure it's broken because of the partisanship.
But it's also broken because nobody plans. Nobody's willing to do
something for 10 years down the road. Everybody thinks about the next
election.

We need a plan, a 10-year plan that is going to take us to a
first-class infrastructure that will keep us competitive. The port of
Shanghai in five years will take more throughput than all American ports
put together.

MORAN: Ten-year plans not something that the United States
government does very well, but the stimulus, that was a big debate here
this week. Both of you were supporters of it. The Republican Party,
though, staked out a pretty stark position on the stimulus, summed up by
Mitt Romney at the CPAC convention this week when he basically -- this
is his take, and really speaking for the Republican Party in general on
what the stimulus did.

(BEGIN VIDEO CLIP)

ROMNEY: He scared employers. The jobs were scarce. His nearly
trillion-dollar stimulus created not one net new job in the private sector.

(END VIDEO CLIP)

MORAN: Governor Schwarzenegger, that is where the Republicans are,
that the stimulus was a failure and that it did not create one net new
job in the private sector. True?

SCHWARZENEGGER: Well, you know, to me I find it interesting that
you have a lot of the Republicans running around and pushing back on the
stimulus money and saying this doesn't create any new jobs, and then
they go out and they do the photo ops and they are posing with the big
check and they say, isn't this great? Look what the kind of -- the kind
of money I provide here for the state, and this is great money to create
jobs, and this has created 10,000 new jobs and this has created 20,000
new jobs. And all of these kind of things. It doesn't match up. So
it's exactly--

(CROSSTALK)

RENDELL: It's hypocrisy at the highest level.

SCHWARZENEGGER: I think, you know--

(CROSSTALK)

SCHWARZENEGGER: -- of my Republican colleagues, but I think it's
kind of politics, rather than thinking about only one thing, and this is
how do we support the president, how do we support him and do everything
that we can in order to go and stimulate the economy, get the economy
back, and think about the people rather than politics.

I have been the first governor of the Republican governors to come
out and to support the stimulus money because I say to myself, this is
terrific, and anyone that says that it hasn't created the jobs, they
should talk to the 150,000 people that have been getting jobs in California.

MORAN: Private sector?

SCHWARZENEGGER: Yes, for the private sector and also from the
public sector. I mean, if it is teachers, if it is university
professors, if it is people that are building infrastructure and stuff
like that. I mean in every category, there is jobs that have been
created in California, 150,000. This is 150,000 people that are going
home today with a check that are providing for the family, that can buy
the textbooks for their kids, that are feeling wanted and needed and
feeling productive. I mean, a better job, it isn't just a job, it's all
of those kind of other things. So I'm happy that we got this money.
I'm happy that we have put 150,000 people to work and there will be more
people that we will put to work.

MORAN: You'd do it again. Did Pennsylvanians think it worked?

RENDELL: Yes, I think basically they do and you know, Mitt Romney
is a pretty smart guy. He was very clever there. He said net new
jobs. We could fill up every baseball stadium in this country, Terry,
with people who got jobs or whose job was saved by the stimulus.
There's no ifs, ands or butts about it. Pennsylvania's budget is a
little under $28 billion. We get almost $3 billion this year from
stimulus. Take that $3 billion away, we've cut most of our program
grants to the bone. You'd have to lay off -- I'd have to lay off 37,000
state workers to balance the budget. We have 76,000 state workers.

If we did it with counties, it would be teachers, fireman, police
men, emergency workers. So has it saved jobs? You bet it has. Has it
created jobs? I'll take Governor Romney out to any construction site in
Pennsylvania and then I'll take him -- we'll drive to a construction
site, back to the steel plant that provided the steel for the bridge.
He knows better.

MORAN: But as Governor Schwarzenegger says, it's politics, but it's
politics that gain traction. And I want to ask you, Governor Rendell,
big fanfare this week, the Obama administration fanned out across the
country, does stimulus work? The president made speeches, sounded a
little frustrated that people don't get it, at least the polls show,
that they don't understand there were tax cuts and things like that.
What do they do while they're playing defense on what was one of major
accomplishments? What did the White House, the president do wrong in
explaining, presenting itself?

RENDELL: Ironically, the best communicator in the history of
political campaigning turned out in his first year in office to not
communicate very well. They let the Republicans take the spin right
from the beginning. The stimulus got beat up before one dollar was
spent. What I would have done, and I've been in charge of the
president, is I would have had him Tuesday night -- not Tuesday night
was the inaugural ball. Wednesday night I would have had him make a
speech to the nation, break down what stimulus because a lot of the
stimulus, it wasn't job creation, but was safety net. But not safety
net for people on welfare, safety net for hardworking Americans who lost
their jobs, extending unemployment benefit. Is there anybody in the
Congress -- Republicans aren't going to raise their hands and vote
against that, right? Everybody is in favor of that. That was an
important component of the stimulus. COBRA, health care benefits, for
people who lost their jobs. But we never explained it from the get go
and we lost the spin war. The stimulus has done a great job for
America, but we lost the spin war. And once you lose it, it's hard to
get it back.

MORAN: It's a very aggressive Republican positioning and I want to
go back to the CPAC conference. The Republicans reasserted their
congressional power. Essentially the massive campaign of obstruction,
filibusters more than 100 in one year, 80 percent of major legislation
-- and as Mike Pence, congressman from Indiana, one of the Republican
conservative leaders in the House put it at CPAC, they're proud of that
record.

(BEGIN VIDEO CLIP)

REP. MIKE PENCE, R-IND.: Sometimes no is just what this town needs
to hear. When it comes to more borrowing, the answer is no. When it
comes to more spending, the answer is no. When it comes to more
bailouts, the answer is no.

(END VIDEO CLIP)

MORAN: Governor Schwarzenegger, is the Republican Party, your
party, the party of no right now?

SCHWARZENEGGER: Well, you know, they have the big opposite
position. I mean, because first when it come to the party itself, they
have to do everything they can in order to win in November. So they're
going to say no to everything, they're going to say it is not good but
Obama is --

MORAN: So they are the party of no.

SCHWARZENEGGER: They're the party of no, and at the same time, I
think that there are a lot of people that are disenchanted and
dissatisfied and they're angry and this is why you have the Tea Party
and all of those things. The Tea Party is not going to go anywhere. I
think the Tea Party is all about just an expression of anger and
dissatisfaction and I see it in California when people come up to me and
says, you know I'm angry that you guys don't get along in Sacramento.
I'm angry that they're not getting along in Washington. I'm angry that
nothing gets done. I'm angry that I'm unemployed. I'm angry that
people are losing homes. I'm angry that businesses are losing their
businesses and all of those kind of things. And the economy is down.

But that's only the case in California. That's not only the case in
America. That's the case all over the world. If you read six
newspapers from different parts of the world, you will see the headlines
are pretty much the same. They're all angry at their leaders because
the economy is down and the world basically has one-third less wealth
right now. And so that makes people angry.

So I think the key thing for the Obama administration is to just
keep staying on track. Nothing is going to be easy. And you're going
to fail and you're going to do well, and you're going to fail, and
you're going to do well.

If you look at the Olympics -- I think all of the lessons in life,
you can learn from sports. I mean, this girl Vonn who just had the gold
medal in skiing and did a fantastic race in the downhill, the next day
she wiped out. That's the way it is, and totally accepted in sports --
totally accepted. People say, oh, that's too bad, isn't it, but the
next time, she's going to go do the giant slalom, and then there will be
the slalom, and so on.

In politics, when you fail, it's like the end of the world because
the press keeps piling on you and beating you up and all of those kind
of things.

(LAUGHTER)

I am never afraid of failing. I've failed several things that I
tried to do in California, but we have won with many things that we have
tried in California and we have done in California. Just the
redistricting -- it was a perfect example. Five times, we tried
redistricting. And we had lost and lost and lost. And people said,
don't you get the message that people said no?

And I said, no, I will never get the message. I will always try and
try. And the fifth time, we got it, and we won it. The same will be
with open primaries, now, in June. We will win open primaries because
people want to have politicians not to be so far apart, left and right
and be -- cannot get in the middle and get anything done. They want to
get together. They want us to work together.

And this is why this partnership is so perfect because Bloomberg is
an independent; Rendell is a Democrat; I'm a Republican. So what we are
saying is we are for rebuilding America, but it's a political issues;
it's a people (inaudible) issue. We want to serve the people of America.

MORAN: And people want to see that, and that kind of
bipartisanship, but right now, we have this partisan divide. So let me
ask you directly, Governor Rendell, does President Obama, having been
outmaneuvered by the party of no, right now, as the governor says, does
he need a shake-up?

Does he need some new blood in the White House?

RENDELL: No, I think they just need to take a deep breath, look at
what happened and revamp their strategy. They've still got the best
communicator I've ever seen in my life in politics.

But, Terry, I want to say something about Representative Pence. He
seems to be a very decent person, but what he just said there is the
most dangerous prescription for America, no spending, no borrowing.

How in God's name -- I'd love -- I was a former prosecutor; I'd love
to cross-examine Representative Pence. How in God's name does he think
we're going to repair this nation's infrastructure, stay competitive,
give safety to our people, improve our quality of lives?

Every business that's successful in this country has, at some key
moment, reinvested in itself, usually by borrowing or taking out capital
reserves.

They reinvested. They created another product line, built a new
factory. If you don't invest in your future, you will die. And
Representative Pence and the people at that convention -- when they say
no borrowing, no spending, no investment, they're writing out a
prescription form for this country becoming a second-rate power.

And I don't think the governor and I, and there are others out there
with us -- we're going to fight that theory. Because we've got to
invest in our future. If we don't invest, what's going to happen to
American manufacturing?

MORAN: The challenge, of course, is they're looking at an ocean of
red ink. One of the other things that happened in Washington -- the
president appointed a national commission on the debt. Alan Simpson,
one of the co-chairs, did an interview with Judy Woodruff on PBS, in
which he tried to get real.

SIMPSON: I'm not smoking that same pipe. I just -- everything is
on the table.

(END VIDEO CLIP)

MORAN: Everything is on the table. He's not smoking that pipe.

Now would each of you agree that -- you look at this ocean of red
ink, a Republican and a Democrat -- get real -- that, to solve the
fiscal disaster looming for the country, Republicans here in Washington
are going to have to agree the government gets more revenue; Democrats
are going to have to agree, long-term entitlements get cut?

RENDELL: No question. And you can cut entitlements in a very
intelligent way. I mean, we're working longer; we're living longer.
There's no reason why entitlements can't be pushed back, in terms of
age. And everyone knows that. It's a dirty little secret, but people
have got to get together and say it.

MORAN: That wasn't even hard to get the two of you to agree on that.

SCHWARZENEGGER: Well, we have agreed on that -- we have agreed on
that for a long time.

(CROSSTALK)

SCHWARZENEGGER: I think there's no two ways about it, that we in
this country have a major problem with spending on ongoing programs, and
especially on promising people things that we can't keep. The pension
in a disaster in California and in the whole nation. We have pension
obligations that we cannot fulfill. We have health care obligations,
unfunded obligations that we cannot fulfill.

I mean, in California, we're talking about hundreds of billions of
dollars, and it's very dangerous. So those are the areas that people
are upset about, and those are the kind of things we have to stop.

But one should never get confused between spending money and
investing in the future of America. And what we are talking about, with
our partnership, is about is investing in the future of California. We
have made a commitment in California of $70 billion since I've come into
office. And right now, the legislature, after four decades of arguing,
have come together, Democrats and Republicans, and have made a
commitment to $11 billion in bonds for water infrastructure. Because
what has happened this last year in the valley, having 40 percent
unemployment because of the lack of water, it was devastating.

So the California people know the difference, and that's why they
have approved of those infrastructure packages, including the high-speed
rail, the $10 billion. And they will also approve in November the water
infrastructure, which is very important so we have water in the future.

So we've got to rebuild our state, and the whole country has to
rebuild itself. Because if you think in all of the -- in history, I
mean, all the great civilizations all became great because they had
great infrastructure. If you think about the Persians, of building the
waterways and the paved roads. The Romans, they had the aqueduct system
of delivering water and the sewage systems. The Egyptians, they builtÿ2Dÿ2D

(CROSSTALK)

RENDELL: How many people (inaudible) Great Wall of Chinaÿ2Dÿ2D

(CROSSTALK)

MORAN: ÿ2Dÿ2Drun out of time here, but I have one more question.

SCHWARZENEGGER: But it is -- I just want to say that the decay and
the falling of those empires and of the civilizations is directly linked
to not keeping up the infrastructure. So we have to be very, very
careful in America to keep up our infrastructure, not only to maintain
it, but to build, because it is our ports, if it is our freeways, if it
is our airports, and all of those things needs to be rebuilt.

MORAN: One more, briefly. The health care summit coming up. Do
you expect anything out of this? What should Republicans do? They are
coming to the table saying the president has got to take this bill off
the table to begin with before they even talk? Just a couple of seconds
on this.

SCHWARZENEGGER: Well, first of all, I think that Mrs. Obama is
doing something very smart right now. She's gotten into the obesity
summit business, and I think that if you do health care, you cannot do
health care without prevention. I think the prevention part is the
biggest and the most important part of health care reform. And so, for
her to talk about obesity, which is a huge problem, because it creates
the diabetes and all the health problems in children. We make our
children -- they are now 10 pounds heavier today than they were 20 years
ago. So all of this I think going in the right direction.

MORAN: Republicans should come to the table to do a deal?

SCHWARZENEGGER: I think that Republicans should be at the table
with health care reform and bring their ideas, whatever it may be. I
thinkÿ2Dÿ2D

(CROSSTALK)

SCHWARZENEGGER: If it is just tort reform -- I mean, just think
about tort reform. That could be a huge improvement in the health care
reform. And prevention could be a hugeÿ2Dÿ2D

RENDELL: Terry, the Republican Party has a very difficult task
ahead. They can't just say no on Thursday. The American people are
watching and they are watching clearly. They've got to come up with
some ideas, and they've got to say what you said. You take some of our
ideas; we'll take some of your ideas. We may not love your ideas, but
we'll take them. If they don't do that, I think this whole dynamic of
this political year could turn around.

SCHWARZENEGGER: This is what compromise is all about. You've got
to have two opposing point of views. You try to bring them together and
try to find out where is the sweet spot here? And there's the also the
sweet spot. If there is a will, there's a way. If you really want to
serve the people and not just your party, I think you will find that
sweet spot and you can get it done.

MORAN: All right. Governor Schwarzenegger, Governor Rendell,
thanks very much for being here. Good luck on the infrastructure project.

RENDELL: Thank you.

SCHWARZENEGGER: Thank you. Thank you very much.

MORAN: And up next, we'll have the roundtable with George Will,
Arianna Huffington, Matthew Dowd and Donna Brazile. And later, the
Sunday Funnies.

MORAN: The conservatives stoked this week at the CPAC conference by
their speakers. You saw Glenn Beck taking aim at the Republican Party,
there. We're going to talk about the week in politics.

Our roundtable, George Will, of course, Arianna Huffington of the
Huffington Post, political consultant Matt Dowd, and Donna Brazile.

And let me begin, George, with what we just saw, Glenn Beck, there,
taking aim at the Republican Party, CPAC embracing the tea party
movement, in a way. What does -- what does it mean, this libertarian
tea party streak coming into the movement conservatives, coming into the
Republican Party?

WILL: They're natural Republicans. They're not all Republicans.
In fact, one-fifth of the people who identify themselves as tea party
supporters voted for Barack Obama. And one-third of them express
approval of Barack Obama. But they are alarmed and anxious and fearful
about what the government is doing.

CPAC has been meeting for decades in one of Washington's largest
hotels. This year, they had to move to a larger hotel. So the energy,
the intensity in American politics, right now, is on the right. And
this is partly because a lot of the people who come to CPAC are college
students. They're young. And so there's a bit of over-the-top
rhetoric, as you would expect.

And when you're a year after a party has just lost the presidency,
and you don't have -- the faces of the next generation aren't clear,
it's the hour of the entertainer. And they had a lot of entertainers
there.

MORAN: (inaudible), Arianna? Is this the return of the
conservative movement, here, after being flat on its back after the
Obama victory?

HUFFINGTON: Well, let's first of all mention that the straw poll
was won by Ron Paul. Last year, it had been won by Mitt Romney.

And the violent imagery was fascinating. And even Tim Pawlenty, who
is supposed to be a moderate, said that we need to take a page out of
the playbook of Tiger Woods's wife and take a nine-iron and smash a
window out of big government. That was the day after the pilot had
flown a plane into a federal government building.

So that kind of rhetoric is disturbing. And of course what must be
troubling for the conservatives is that the big hit -- the guy who got
the rock star welcome was Dick Cheney. Dick Cheney left office with 13
percent approval rating. And there were shouts of "Run, Dick, run,"
which I'm sure the White House if fully endorsing.

MORAN: But they love Glenn Beck.

DOWD: Yes, they do love Glenn Beck. I mean, he's popular among a
segment of the party.

I mean, I think this is more -- the commentary about this is more
about the volatility of politics in this country today. Because if you
think back a year ago, everybody said, well, what happened to the
conservatives? What happened to the Republican Party?

And now people are saying, well, what happened to Barack Obama? And
it's 13 months later, after the inauguration of Barack Obama.

And I don't think Republicans can sit there and say, oh, we're going
to have this great success. This is not about the Republicans right
now. This is about why people are mad at the Democrats in Washington
and the incumbency in Washington. That's what people are mad about.

This is not a bunch of people flocking to become Republicans. But
CPAC and the tea party is best representing people's anger right now, in
the country, on the right. And I think that's what this is about, is
people are angry, whether they're Democrats or Republicans or
independents; they're mad at Washington, and anybody that represents
Washington is bad.

MORAN: But that's energy. The president's loyalists seems to be
disheartened.

BRAZILE: No, I don't think they're disheartened. They're just
asleep, and at some point, they'll wake up. I'm an optimist.

I didn't watch too much of the CPAC. I didn't want to get infected
with the virus anger...

(LAUGHTER)

... given the blues that I've had over the past year.

I think what you're seeing now on the right is a revival. They are
feeling energized. They feel as though it's their time.

Now, the question is, will the modern Republican Party be able to
harness this anger and turn it into electoral gains?

We have no proof of that? But, for now, they're able to gather a
large segment of the base in one hotel room and cheer each other on.
And there's nothing wrong with that. That's American politics.

MORAN: Anger. George, does it bother you at all that the John
Birch Society is back inside the tent after Bill Buckley spent decades
trying to run that wing of the party out?

WILL: It's a big tent. And the tent is a circus imagery. And so
you have a freak show side of it. But this is a trivial, infinitesimal,
not-noticeable thing, other than by people eager to discredit the
Republican Party.

HUFFINGTON: I think what is not trivial is the anger. The anger is
real and the anger is across the board. It's across the political
spectrum and across the country.

And for the first time, Republicans have a great case study about
government being part of the problem rather than part of the solution.
And that's the bailout of Wall Street.

That is really at the heart of all the anger. If you look at every
poll, the second question, the third question comes back to Wall Street
and the bailout, the sense that we bailed them out, taxpayers, billions
of dollars, and now they're doing very well and Main Street is
suffering. And that needs to be addressed.

DOWD: Well, I think -- I think -- one of the things, I think, it's
about that. But it's, I think, more fundamentally about, people don't
understand why Washington can't be adults, why it's a dodge ball game
and anybody that ventures to (inaudible) a solution is pelted by either
side.

They just do not understand why it's a bunch of children at the
Capitol or in the administration, playing all sorts of games, while
they're sitting out there suffering because they can't pay for school;
they don't have a job; their uncle can't -- doesn't have health care,
all of that kind of stuff, while Washington sits here and yells and
screams at each other and nothing gets done. That's, to me, where the
anger is based.

BRAZILE: But, Terry, their feeling is, at the grassroots level --
the states -- we just talked to -- you just talked to two governors.
This year, with the budget that they've already put out, state
governments will lose about $190 billion.

That's a lot of cuts that they have to make in Medicaid and
children's health programs, yes, hiring freeze, George. I know you're
worried -- you're worried about state employees.

(LAUGHTER)

Teachers, public safety personnel. They are feeling this not just
at Washington but they're feeling it right in their own backyards.
They're feeling the decline in services. They're seeing their
mortgages, their health care go up. And you know what? They're feeling
like they don't have a lot of power right now.

MORAN: And Matt is right, there is this sense that something is
broken in Washington, summed up this week by Senator Evan Bayh, who
announced his retirement, and I think it's fair to say is leaving in
disgust. Here's what he had to say.

(BEGIN VIDEO CLIP)

SEN. EVAN BAYH, D-IND.: I've had a growing conviction that Congress
is not operating as it should. There is much too much partisanship and
not enough progress, too much narrow ideology and not enough practical
problem-solving. Even at a time of enormous national challenge, the
people's business is not getting done.

(END VIDEO CLIP)

MORAN: Is he right, George?

WILL: Well, it's hard to take a lecture on bipartisanship from a
man who voted against the confirmation of Chief Justice Roberts, the
confirmation of Justice Alito, the confirmation of Attorney General
Ashcroft, the confirmation of Condoleezza Rice, the secretary of state.

Far from being a rebel against his party's lock-step movement, Mr.
Bayh voted for the Detroit bailout, for the stimulus, for the public
option in the health care bill.

I don't know quite what his complaint is. But, Terry, with
metronomic regularity, we go through these moments in Washington where
we complain about the government being broken. These moments all have
one thing in common. The left is having trouble enacting its agenda.

No one, when George W. Bush had trouble reforming Social Security,
said, oh, that's terrible; the government's broken.

HUFFINGTON: Well, actually, what we do with metronomic regulatory
-- I like that phrase -- is complain about partisanship. That is one of
the most ludicrous complaints.

WILL: Hear, hear.

HUFFINGTON: Every major milestone in American history has been won
after a major, protracted and partisan battle. Go back to the
Emancipation Proclamation, the 19th amendment, the New Deal, Medicare,
Social Security, the Voting Rights Act. These were big partisan
battles. One of them involved the Civil War.

And so the idea that somehow we can all come to the middle and do
what, free half the slaves, or free them from 12 to 5?

(LAUGHTER)

You know, these are major issues that people have very definite
differences on.

MORAN: But the country is in the great muddled middle, basically.
All polls show, on most issues, they'd like some compromise.

HUFFINGTON: That's not true at all. That's not true at all. Even
the despised public option has 70 percent behind it. Nate Silver just
crunched the numbers last week. The jobs bill has -- the $100 billion
jobs bill, not the $15 billion jobs bill in the Senate, has 70 percent
of the people behind it.

The idea that the -- we are in a mushy middle is simply a media
invention.

DOWD: Well, I think Senator Bayh obviously made his own personal
decision that he didn't want to be here anymore, for whatever reason
that is. To me, that's not a solution to the problem. Adults don't
leave the playground and leave to it the kids to -- if he believes he's
an adult and he can do this, walking off the playing field and not being
part of trying to solve the problem isn't a solution to the problem.

I actually think one of the difficulties we're in -- I don't think
it's an institutional problem. It's not the Senate rules and it's not
how the president operates and all of those sorts of things.

It is leaders that are willing to take on elements of their own
party. We have to have leaders that are willing to, sort of, confront
their own party, whether it's Republicans confronting Republicans or
Democrats confronting Democrats, and saying, just because it's got a D
by its name doesn't mean it's necessarily the right solution, or just
because it's got an R by its name doesn't mean it's the right solution.

Civil rights is a perfect example. Democrats, throughout the
history of civil rights, sought to kill civil rights, throughout the
whole -- throughout the whole thing.

MORAN: Until the 1960s.

DOWD: Until the 1960s, until Republicans, who cast more votes on
behalf of civil rights legislation to get it done. But in the end, some
Democrats -- LBJ had to take on elements of his own party and risk
political problems, which he did.

MORAN: And President Obama really isn't doing that.

BRAZILE: I think President Obama is leading. But, unfortunately,
you have a Republican Party that has decided that, by saying no, they
could, you know, perhaps gain more at the polls this coming fall.

Look, one-tenth of the Republican caucus in the House has announced
their retirements, OK, only 13 Democrats in the House. We have more
Republicans retiring in the United States Senate than -- than Democrats.

We know from 1994 as well as 2008, when you look at two volatile
periods that if you have to defend open seats, it's very difficult. So
for Democrats right now, the game is to hold as many seats as possible
and to not retire. For Republicans, they still have to come up with
some ideas to go out there and galvanize the electorate. One-third of
the American people is still with the president, one third is against
the president. There's 30 percent of the American people that is still
up for grabs. And if this president leads, he will be able to capture
those people.

WILL: I want to say something in defense, particularly to Donna, of
being the party of no. The Republican Party elected its first president
because he said no to a bright idea a Democratic senator had, which was
I'll solve the problems, said Stephen A. Douglas, of expansion of
slavery into the territories. Let's have popular sovereignty. People
can vote it up or vote it down. A lawyer from Springfield, Illinois,
named Lincoln said no, that's a bad idea. We're going to stop that
idea. Now is the Republican Party the party of no, you bet they weren't.

BRAZILE: You know, George, is the Republican Party going to defend
the 39 percent rate hikes on insurance premiums this coming week when
they hold the health care summit? Will the Republican Party continue to
defend all of these job cuts across the country when you see governors
having to eliminate very popular programs? Let the Republicans continue
to say no. I think Democrats have to lead and it's up to the president
to demonstrate that.

MORAN: It is a challenge, and let's turn to the health care
summit. It looks like Republicans are ready to come and say, no, take
that bill off the table.

HUFFINGTON: Absolutely. They've made that very clear. Even Newt
Gingrich at the CPAC convention yesterday, he said that we need to start
from crash, eliminate everything in their health care bill and start
from scratch. So here's really my problem with the president. Why does
he really think that he can get Republicans to find common ground, after
all the experience of the past few months? I mean, why is he so intent
on seducing Olympia Snowe and Chuck Grassley? The problems is that the
American people are with him when it comes to the essential elements of
the bill. It's the way the bill has been solved that have turned people
against the legislation.

DOWD: I totally disagree with this. Barack Obama's problem is not
the Republicans. Barack Obama's problem is the American people. The
American people decided they don't want this health care bill. They
don't think any jobs have been created. They don't think anything's
really been done in Washington.

So the idea that the Republicans are the ones? Republicans are just
representing a wave out there. They are standing on top of a wave that
the American public says we don't like any of this. And I think in the
end, it's not a sales job. To me that's like saying somebody owns a
restaurant and nobody eats their food so we're going to do more
advertising.

BRAZILE: He has the job of governing, and that is where the
president has, I think, fallen short.

DOWD: Isn't he supposed to be the best speaker in the history of
the country?

BRAZILE: You know what, I wasn't voting for a speaker. I was
voting for somebody who can lead.

MORAN: I was wondering if you said something true in a different
sense, in that you're both right, but the problem is the American
people, but not for the president but for themselves. Maybe the
fundamental political attitude of American people is I want my
government goodies, I don't want you to get your government goodies and
I don't want to pay for anything.

DOWD: I don't think that's true.

HUFFINGTON: The American people know that our health insurance
system is broken. Every day, they have experience of that. And right
now, if you look at the polls, when it comes to specific things,
pre-existing conditions, competition when it comes to health insurance,
and this is the American people are with the president. The problem is
that the American people don't know where the president is. Where is
the line in the sand?

DOWD: They know where the president is, they just don't like where
he is.

WILL: When we started this health care debate a year ago, a 85
percent of the American people had health insurance and 95 percent of
the 85 percent were happy with it. So there was no underlying
discontent that you now postulate to drive this radical change. In
fact, relax, the president is not having this health care summit to woo
Republicans. He's having it so that he can then go to Congress and say,
we're going to ram this through on reconciliation.

HUFFINGTON: I hope so.

WILL: I'm sure you do. And in a way, I hope so, too, in a way,
because it would be a ruinous tactic.

BRAZILE: Well George, in all of the polls prior to this debate that
we had on health care that really took everything out of context, the
majority of Americans thought this was a concern enough so that the
Democrats put in on the table. And I think they lost control of the
debate.

But look, when it comes to the parameters of this conversation this
week, the president is going to outline a set of principles. I believe
it will be here are the things that we all agree, the insurance
industry, the Republicans and Democrats.

Here's the bottom line. We're going to put this package throughout,
I hope they don't shrink it up even smaller because that's one of the
reasons why many Democrats are opposed to it, because it doesn't contain
a public option. It doesn't really decrease premiums which is what
people really want. But the president is going to put this forward
tonight or tomorrow. The Republicans will have an opportunity to chew
on it. If they decide to come to the table with something, an
alternative, fine. If not, the Democrats should possess the will and
the might to go ahead and get it through, George, however ugly it looks.

DOWD: I think in the end, politicians get in trouble when they make
the assumption that they're smarter than the American people. That's
what the problem is. Barack Obama and the administration decided they
were smarter and they knew better what the American people needed on
health care reform and they knew better what they needed on job
performance. They knew better than them.

The problem they have now is the American people figured it out,
they don't like it. And so I were Barack Obama, President Obama, the
thing I would do is start over since the American people -- the worst
thing he could politically do is ram through a bill that everybody hates.

WILL: The administration has met the enemy and it is the founding
fathers of this country who have created a system of checks and balances
and slow-moving government and above all, the unconstitutional --
basically what liberals are saying these days.

Liberals are saying that the filibuster violates the majoritarian
ethic of democracy. And it is preventing them, liberals, from imposing
upon an American majority, a health care bill that the majority detests.

MORAN: Maybe it's the abuse of the filibuster?

HUFFINGTON: Yes, exactly. It's preventing them from having the
president have low level, even presidential appointees. So this is not
exactly what the founding fathers had in mind.

WILL: When Senator Daschle was using this to block --

HUFFINGTON: That's a different argument than the founding fathers.

(CROSSTALK)

MORAN: We're going to shift gears. We've got to get to it because
it was the other big story of the week, you know it's coming. Ladies
and gentlemen, Tiger Woods.

(BEGIN VIDEO CLIP)

TIGER WOODS, GOLFER: I stopped living by the core values I was
taught to believe in. I knew my action were wrong but I convinced
myself that normal rules didn't apply. Parents used to point to me as a
role model for their kids. I owe all those families a special apology.
I want to say to them that I am truly sorry.

(END VIDEO CLIP)

MORAN: It was a unique national and international moment and painful.

WILL: It was painful. Well if your problem is that your behavior
has revealed your public persona to be a fake, you shouldn't stage this
grotesquely fake press conference without questions and with your mother
present. Sally Jenkins, wonderful sports writer, put it best, this is
straight out of the standard playbook. You apologize, you cite your
religion, you cite your charity, and you attack the press.

HUFFINGTON: Well actually, I personally don't think that he owes me
an apology. I don't think he owes anybody an apology, a contrition or
an explanation. I think that if a public figure has not broken the
law, the only legitimate answer to an illegitimate probing of a private
lives then it's none of our business.

MORAN: We called for it. Final word?

BRAZILE: He let down is fans. He let down his family, his fans, he
apologized, but actions speak louder than words.

DOWD: Totally agree with that. Actions speak much louder than words
and that's how he ought to be judged going forward.

MORAN: And that's how he will be judged no question if he ever gets
out on the golf course again. George Will, Arianna Huffington, Matt
Dowd, Donna Brazile, thanks.

"The Roundtable" will continue in the Green Room as always on
ABCNews.com.